1. How are new treatments appraised
How are new treatments appraised? Prof Philip A Routledge Prof Dyfrig A Hughes
All Wales Therapeutics and Toxicology Centre, Cardiff &
Centre for Health Economics and Medicines Evaluation, Bangor, Wales

2. Case Study
A new medicine was licensed in Europe for the treatment early-stage HER2-positive breast cancer, following surgery, chemotherapy (adjuvant or neoadjuvant) and radiotherapy (if applicable). Clinical trial evidence showed that it significantly reduced the risk of recurrence of HER2-positive breast cancers. The treatment cost per patient was typically £22,000 - £30,000 over one year. Q1. Which organisation(s) recommend whether such costly medicines should be available for general use in the NHS? Q2. What criteria and methods do they use to make that judgement?
A new medicine was licensed in Europe for the treatment early-stage HER2-positive breast cancer, following surgery, chemotherapy (adjuvant or neoadjuvant) and radiotherapy (if applicable).
Clinical trial evidence showed that it significantly reduced the risk of recurrence of HER2-positive breast cancers.
The treatment cost per patient was typically £22,000 - £30,000 over one year.
Q1. Which organisation(s) recommend whether such costly medicines should be available for general use in the NHS?
Q2. what criteria and methods do they use to make that judgement?

3. UK National Organisations Responsible for Health Technology Appraisal
NICE
SMC
AWMSG
Established
1999
2002
Remit
England & Wales
Scotland
Wales
Referrals
Technologies referred by Ministers for Health
All newly licensed medicines/ formulations/ indications
All newly licensed medicines/ formulations/ indications not on the NICE work programme
Initial Assessment
Independent Evidence Review Group (ERG)
In-house team and New Drugs Committee (NDC)
In-house team at AWTTC & New Medicines Group (NMG)
Appraisal
NICE Appraisal committees
Scottish Medicines Consortium
All Wales Medicines Strategy Group
Meetings
Twice monthly (in Public)
Monthly (in Public)
Ten times per year (in Public)
There are three organisations which conduct health technology appraisal of medicines in the UK. NICE ( the National Institute of Health and Care Excellence) appraises selected medicines on behalf of NHS England and NHS Wales. The Scottish Medicines Consortium (SMC) appraises all newly licensed medicines/ formulations indications before introduction into NHS Scotland. The All Wales Medicines Strategy Group (AWMSG) appraises all remaining newly licensed medicines/ formulations/ indications not on the NICE work programme.
Adapted from Garner S. How decisions on the use of medicines and medical devices are made. Pharm J. 2005: 275;

4. 1. Efficacy 4. Equity 2. Effectiveness 3. Efficiency Can it work?
The extent to which an intervention does more good than harm under ideal circumstances
Is it fair? Equality of provision across socioeconomic groups
2. Effectiveness
3. Efficiency
Does it work in practice?
Whether an intervention does more good than harm when provided under usual circumstances (now termed “clinical effectiveness”)
Is it worth it?
The effect of an intervention in relation to the resources it consumes (now termed “cost-effectiveness”)
The 4 steps to Patient Access
Efficacy: Can it work?
The extent to which an intervention does more good than harm under ideal circumstances
Effectiveness: Does it work in practice?
Whether an intervention does more good than harm when provided under usual circumstances (now termed “clinical effectiveness”)
Efficiency: Is it worth it?
The effect of an intervention in relation to the resources it consumes (now termed “cost-effectiveness”)
Equity: Is it fair?
Equality of provision across socioeconomic groups

5. Cost-effectiveness plane
New treatment more expensive NE NW
New treatment is dominated – i.e. it is less effective and more expensive than existing treatment
New treatment is more effective but more expensive
Most new
medicines
New treatment more effective
New treatment is less expensive but less effective
New treatment dominates – i.e. it is more effective and less expensive
Existing treatment
Most new medicines fall on the top right quarter of the cost-effectiveness plane (i.e. the new treatment is more effective but more expensive). In those circumstances, it is necessary to measure the incremental effectiveness accrued and the incremental cost incurred compared to the previous best available treatment to assess the incremental cost-effectiveness ratio (ICER). SE SW
New treatment less expensive
Adapted from “Health Economics: An introduction for health professionals by Ceri J Phillips, Blackwell 2005

6. Value for money Calculating the incremental cost-effectiveness ratio (ICER)
Calculate the total NHS costs associated with the new medicine and comparator
including costs of the medicines and their administration, additional clinic visits, hospital stay, tests and procedures
Calculate the health benefits
A generic measure of health outcome is the quality-adjusted life-year (QALY)
This is the number of life years gained multiplied by the quality of that life (utility) as measured by patients
Calculate the differences in costs divided by the differences in benefits – the incremental cost-effectiveness ratio (ICER)
Compare the ICER with a threshold that represents the value of health benefits to the NHS
To measure the ICER, it is necessary to calculate the total NHS costs associated with the new medicine and comparator (including costs of the medicines and their administration, additional clinic visits, hospital stay, tests and procedures.
Then one calculates the health benefits using a generic measure of health outcome such as the quality-adjusted life-year (QALY) This is the number of life years gained multiplied by the quality of that life (utility) as measured by patients
Calculate the differences in costs divided by the differences in benefits – the incremental cost-effectiveness ratio (ICER)
Compare the ICER with a threshold that represents the value of health benefits to the NHS

7. Adjusted Life Years-Gained QUALITY OF LIFE (utility) (Weights)
Quality-adjusted life-year (QALY)
EQ-5D
1.0
Quality-
Adjusted Life Years-Gained
New
medicine
QUALITY OF LIFE (utility) (Weights)
The EuroQol-5D (EQ-5D) is a commonly used generic, preference-based measure of health outcome that can be used to estimate utility for the calculation of QALYs. Utilities are on a scale of 0 to 1, with 0 being death, and 1 being perfect health. This illustrative profile shows an improvement in both quality of life, and life expectancy with the new medicine compared to current practice. The area between both profiles is the QALY gain.
Current
practice
0.0
QUANTITY OF LIFE (Years)
Death
Death

8. An absolute cost-effectiveness “threshold” does not exist
100%
Relationship between likelihood of a medicine being considered as cost ineffective plotted against the log of the incremental cost effectiveness ratio
grounds of cost ineffectiveness
Probability of rejection on
This curve shows the relation between likelihood of a medicine being considered as cost ineffective plotted against the log of the incremental cost effectiveness ratio (ICER). The lower the ICER, the more likely the medicine is to be approved by an HTA body for a particular indication. However, an absolute cost-effectiveness “threshold” does not exist and social value judgements can have a modifying effect on the recommendations made. 0%
£20,000
£30,000
Increasing cost/QALY (ICER) (log scale)
Adapted from Rawlins MD & Culyer A,
National Institute for Clinical Excellence and its value judgments. BMJ 2004; 329:

9. Basics steps of appraisal
Does the new medicine provide patient benefit, based on its comparative effectiveness and safety?
No → do not recommend
Yes → Q2
What are the benefits forgone —through displacement or dilution of other services— as a consequence of recommending the medicine?
Benefits forgone < benefits gained → recommend
Benefits forgone > benefits gained → Q3
Are there reasons for benefits gained with this medicine to be valued higher than benefits forgone?
Yes → recommend only with justification and acknowledgement of net health losses to NHS patients
Scientific judgements
Economic
judgements
The basic steps of HTA are to address the following questions: Does the new medicine provide patient benefit, based on its comparative effectiveness and safety?
No → do not recommend
Yes → Q2
These are scientific judgements
What are the benefits forgone —through displacement or dilution of other services— as a consequence of recommending the medicine?
Benefits forgone < benefits gained → recommend
Benefits forgone > benefits gained → Q3
These are economic judgements
Are there reasons for benefits gained with this medicine to be valued higher than benefits forgone?
Yes → recommend only with justification and acknowledgement of net health losses to NHS patients
These are social value judgements
Social value judgements

10. Clinical pharmacologists are highly active in local Medicines and Therapeutics Committees and, through those committees, in the development of hospital formularies and many other activities related to the use of the medicines
Nationally, they play important roles or even lead the development and delivery of health technology appraisals and therapeutic guidance and guidelines, for example through the work of the National Institute for Health and Care Excellence (NICE), the Scottish Medicines Consortium (SMC) and the All Wales Medicines Strategy Group (AWMSG)
Clinical pharmacologists are highly active in local Medicines and Therapeutics Committees and, through those committees, in the development of hospital formularies and many other activities related to the use of the medicines
Nationally, they play important roles or even lead the development and delivery of health technology appraisals and therapeutic guidance and guidelines, for example through the work of the National Institute for Health and Care Excellence (NICE), the Scottish Medicines Consortium (SMC) and the All Wales Medicines Strategy Group (AWMSG)
Routledge PA. An agenda for UK Clinical Pharmacology; developing and delivering clinical
pharmacology in the UK national health service. Br J Clin Pharmacol. 2012; 73:

11. Answers to Case Study
The medication for breast cancer discussed in this case study was trastuzumab (Herceptin®) for the treatment early-stage HER2-positive breast cancer, following surgery, chemotherapy (adjuvant or neoadjuvant) and radiotherapy (if applicable)
Q1. Which organisation(s) recommend whether such costly medicines should be available for general use in the NHS?
Trastuzumab (Herceptin®) was appraised and recommended for this indication by both NICE and SMC in AWMSG normally only appraises medicines not on the NICE work programme so did not appraise this medicine for this indication
Q2. What criteria and methods do they use to make a judgement?
NICE, SMC and AWMSG all take into account scientific, economic and certain social value judgements
NICE estimated the ICER to be approximately £33,000 per QALY gained and considered this to represent value for money
The medication for breast cancer discussed in this case study was trastuzumab (Herceptin®) for the treatment early-stage HER2-positive breast cancer, following surgery, chemotherapy (adjuvant or neoadjuvant) and radiotherapy (if applicable)
Q1. Which organisation(s) recommend whether such costly medicines should be available for general use in the NHS?
Trastuzumab (Herceptin®) was appraised and recommended for this indication by both NICE and SMC in AWMSG normally only appraises medicines not on the NICE work programme so did not appraise this medicine for this indication
Q2. What criteria and methods do they use to make a judgement?
NICE, SMC and AWMSG all take into account scientific, economic and certain social value judgements
NICE estimated the ICER to be approximately £33,000 per QALY gained and considered this to represent value for money

12. I am a clinical pharmacologist
Clinical Pharmacology and Therapeutics (CPT) is one of 30 physician specialties in the medical career pathway.
Consultants trained in this specialty lead on all aspects of medicines management.
It is the only medical specialty in the NHS focusing on the safe, effective, and cost-effective use of medicines.
Clinical pharmacologists play a crucial role in refining the use of currently available medicines, and in developing the pioneering medicines of tomorrow.
Clinical pharmacologists have diverse career paths working, for example, in the NHS, regulatory bodies, clinical trials units, universities or the pharmaceutical industry.
Clinical Pharmacology and Therapeutics (CPT) is one of 30 physician specialties in the medical career pathway.
Consultants trained in this specialty lead on all aspects of medicines management.
It is the only medical specialty in the NHS focusing on the safe, effective, and cost-effective use of medicines.
Clinical pharmacologists play a crucial role in refining the use of currently available medicines, and in developing the pioneering medicines of tomorrow.
Clinical pharmacologists have diverse career paths working, for example, in the NHS, regulatory bodies, clinical trials units, universities or the pharmaceutical industry.